Why legalizing sports betting (still) faces such long odds at the Legislature this year

Why legalizing sports betting (still) faces such long odds at the Legislature this year

Legal sports betting may be coming to Minnesota. But it doesn't seem to be in much of a hurry.
Consider that the Senate bill that could partly legalize sports novels in Minnesota narrowly slipped out of its first questionnaire Thursday (and faces an uncertain response during its next stop). The majority leader of the Senate isn't keen on the thought. The state's 11 Native American tribes are opposed. Anti-gambling and several religious organizations are opposed. And, oh yeah, it doesn't raise much money.
There is also this: the House bill on the same topic has not been set for a hearing, lacks assistance in DFL leadership, and confronts lots of the same obligations as the Senate bill.
Aside from that, it is a certain thing.
Inspired by Senate Taxes Committee Chair Roger Chamberlain, R-Lino Lakes, the Senate's sports betting bill, SF 1894, will have exemptions from the Republican and DFL senators. And it made its first official appearance before Chamberlain's own committee Thursday. "That is a business, it's a profession, it's entertainment," Chamberlain said. "People do make a living from this… and they also have a great deal of fun."
And although it is not legal in Minnesota, there are many people who bet illegally or through abroad mobile or online sites. Chamberlain believes by legalizing and controlling it, the condition could bring to the surface what is currently underground.
But sports betting gambling is a minimal profit company for casinos; a lot of what's wagered is returned to players as winnings, which means the part that would be subject to state taxation,"the grip," is comparatively modest. Chamberlain's bill would tax that amount — the amount of wagers minus winnings — in 6.75 percent.
State Sen. Roger Chamberlain
MinnPost photo by Peter Callaghan
State Sen. Roger Chamberlain
"Many nations think it is a money-maker for these and it might be," Chamberlain said. "But we're not in this to increase a great deal of revenue. We want people to take part in the company and have some fun doing this." Race and casinos tracks could benefit using sports betting as a way to attract more people in their casinos, he said.
The bill claims that if the nation's tribes wish to offer sports betting, they'd have to ask a new compact with the state, something required by federal law. The country is obligated to bargain in good faith and that includes agreeing to some kind of gambling already allowed off reservation.
But the executive director of the Minnesota Indian Gaming Association, John McCarthy, said Thursday that the tribes have lots of concerns about both the House and Senate bills, also are in no rush to add sports gambling to their operations.
McCarthy said the tribes have spent billions of dollars in gambling centers and utilize them to raise money to cover"human services, schools, clinics, home, nutrition plans, wastewater treatment facilities, law enforcement and emergency services, and other solutions."
"Because these operations are crucial to the capacity of tribal governments to meet the needs of the own people, MIGA has had a longstanding position opposing the expansion of off-reservation gaming in Minnesota," McCarthy explained. The cellular facets of the bill, he said, would"make the largest expansion of gambling in Minnesota in more than the usual quarter-century, and therefore MIGA must respectfully oppose SF1894."
He said that the tribes were particularly worried about mobile gaming and how it could lead to even more online gaming,"which signifies a much more significant threat to all types of bricks-and-mortar facilities which currently offer gambling: Japanese casinos, race tracks, lottery outlets, and bars together with charitable gambling"
Additionally opposed was an anti-gambling expansion set and a spiritual social justice organization. Ann Krisnik, executive director of the Joint Religious Legislative Coalition, cited the state fiscal note that said the earnings impacts of the bill were unknown.
"It is unknown not only concerning revenue, but it's unknown also in terms of the ultimate costs this creates for the state," Krisnik said, citing social costs of gambling.
Jake Grassel, the executive director of Citizens Against Gambling Expansion, said the bill was a bad deal for the nation. "The arguments in favour of legalizing sports gambling may seem meritorious at first blush — that is, bringing an unregulated form of gambling from the shadows," Grassel stated. "Upon further reflection and consideration, the prices are too high and the advantages are too small."
A way to'start conversations with the tribes'
The Senate bill ultimately passed the Taxes Committee with five yes votes, two no votes and a"pass." Two additional members were also absent. It now belongs to the Senate Government Operations Committee.
After the taxation committee vote, Chamberlain stated he considers this a method to start conversations with all the tribes. Even if the bill passes, it doesn't take effect until September of 2020. And compacts would need to be negotiated to clear the way for on-reservation sports betting.
"We're hopeful that they will come on board," Chamberlain said of these tribes. "Their business model won't continue forever. Young people do not visit casinos. I go to them occasionally with my spouse and others and frequently I'm the youngest one there and I'm in my mid-50s. We believe it is a business enhancer.
"I know their care but we're right there with them and when they make more comfortable and more people know about it, I'm convinced we'll move," he explained.
Later in the afternoon, Senate Majority Leader Paul Gazelka stated the GOP caucus has not met to discuss the issue and he is not in a hurry. He said the mobile gambling aspects are of particular concerns to him and he's personally opposed.
"I do know that it needs more time and that is the 1 thing I'm gonna ask of this invoice," Gazelka said. "It's come ahead around the nation and we're gonna have to deal with it just like any other matter. But it is not a partisan issue."
Some thorny questions that are legal All of this became possible when the U.S. Supreme Court ruled last spring that Congress had exceeded its power when it announced that sports gambling was illegal (except in Nevada, in which it was already operating at the time). New Jersey had sued to clear the way for sports books at its struggling Atlantic City casinos.
The conclusion quickly led countries throughout the country considering whether to legalize and regulate sports betting. Eight already have, and surveys suggest legalizing sports betting has wide popular support.
The problem for the country's gambling tribes is whether they'd make enough from the new gaming option to compensate for the potentially massive growth of this off-reservation. There is no clear response to whether tribes can do much with mobile gambling, because the federal Indian Gaming Regulatory Act that created the financial boost of casino gaming allows gambling only on reservations. While some states have declared that using the computer servers that process bets on reservations is sufficient to obey the law, the problem has not yet been litigated.
The House and Senate bills also increase a thorny political and legal dilemma since they apply state taxation to tribal gaming, something the federal Indian Gaming Regulatory Commission has ruled is not permitted. While tribes in different states have consented to share gaming revenue with countries, it's come with invaluable concession — for example tribal exclusivity over betting.
Even though the House bill gives the tribes a monopoly for now, the Senate version cuts the nation's two horse racing tracks in on the action. A 2018 analysis of this issue for the Minnesota Racing Commission calls sports gambling a"momentous threat" to racing, but notes that each of the countries but one that have legalized sports gambling have let it be provided at race tracks. According to the commission, the Thoroughbred Idea Foundation has reasoned that"he most obvious means of decreasing the possible negative impacts of legalized sports betting on the racing industry is to allow sports betting at racetracks and to direct internet revenues to the support of breeding and racing in the state. "
The Senate bill allows a kind of mobile betting but requires the use of geofencing to assure the bettor is within state boundaries and requires them to get an account that has been produced in person in the casino or race track. Additionally, it generates a Minnesota Sports Wagering Commission, which will make rules such as what types of bets will be allowed and also regulate the matches.